Category: News

It’s a symptom of the current moment that ideas that might have some merit, or could help solve a problem, are prematurely described by advocates or policy makers (or, yes, journalists) as the “next big thing” before they have proven themselves effective.

Many students rely on student loans as a way of covering college expenses. According to the most recent data, among all undergraduate students, 36 percent borrow federal loans and 6 percent borrow private loans to finance their education. Students’ loan repayments often exceed their ability to repay, leading to financial distress or default.

Melissa Gillbanks is no fan of student loans, so when she was looking for a way to pay for her senior year at Purdue University, she was happy to sign away a portion of her future income in exchange for a very different way to raise cash for college. Gillbanks decided she would finance part of her last year of school with something called an income-share agreement.

WEST LAFAYETTE, Ind. – Purdue Research Foundation announced Monday (April 3) that it is expanding its Back a Boiler – ISA Fund program to include all rising sophomores, juniors and seniors and will offer the program to eligible students enrolled in the 2017 academic summer session.

WEST LAFAYETTE, Ind. – Purdue Research Foundation announced Monday (April 3) that it is expanding its Back a Boiler – ISA Fund program to include all rising sophomores, juniors and seniors and will offer the program to eligible students enrolled in the 2017 academic summer session.

Most student financial aid for higher education comes in two forms: loans and grants. As tuition costs have grown, however, both options have had a hard time keeping up—grants are oversubscribed and loans have left college dropouts struggling to pay off debts without any of the financial benefits of holding a degree.

For much of the new year, Jason Delisle has taken every available opportunity to argue against a return to the bank-based federal student loan system that existed before 2010. On panels, in policy papers and in guest columns and op-eds, the American Enterprise Institute resident fellow has made the case that returning to a bank-based system from the current set-up where the government originates all federal student loans — a plank of the GOP platform — is misguided policy.

This bill authorizes an individual (i.e., a student) and another person (i.e., an investor) to enter an income-share agreement (ISA) in which the student agrees to pay a percentage of future income, for a specified period of time, in exchange for funds to pay for postsecondary education, workforce development, or other purposes.

It’s yet to be seen if income-share agreements (ISAs) will take off as a more popular way of financing a higher education, but students and parents appear to be interested in the method as an alternative to student loans, according to a new report from the American Enterprise Institute (AEI).